The Medicare Payment Advisory Commission approved draft recommendations that hospitals receive a full-inflation Medicare update in 2006 and that Congress authorize rewards for providers using certain information technologies and establish a loan program to help community-based providers build interoperable IT systems. The recommendations were made during the first of two days of MedPAC meetings covering a broad range of topics, including policy options on specialty hospitals, CMS pay-for-performance initiatives and efforts to promote IT. MedPAC still must make formal recommendations to Congress, which has no obligation to accept them.
Hospitals' projected 2005 Medicare margin of -1.5% was slightly better than in previous years -- compared with an actual margin of -1.9% in 2003, for example. MedPAC said current facility payments are adequate given cost pressures on the Medicare program. It also noted that the 2006 update need not include a technology factor because of new funding in HHS' budget for technology payments. -- by Tony Fong